Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of ₹1 crore on State Bank of India by order dated November 16, 2021. The penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949, after RBI found that SBI had contravened section 19(2) of the Act by holding shares in borrower companies, as pledgee, in excess of 30% of the paid-up share capital of those companies. RBI said the action was based on deficiencies in regulatory compliance and did not pronounce on the validity of any transaction or agreement with customers.